Mexico Business Opportunities: Why is Mexico the best country to do business in 2023?

Mexico is the second largest economy in Latin America and, despite adverse global market conditions, continues to recover strongly from the covid-19 pandemic.

The Mexican economy grew by three percent last year due to booming tourism and a steady increase in vehicle exports. These are positive indicators for the growth of Mexico's business opportunities in 2023.

To gain a competitive advantage and make the most of these business opportunities, you need to understand the latest legal, accounting and tax rules in Mexico.

Let's examine these factors and see why Mexico stands out as one of the best countries to do business this year.

Why is Mexico a good country to do business in?

Known as the gateway to Latin America, Mexico is known for its tourism, culture, food and diversity. Its economy is 15th largest in the world in GDP terms and the 13th largest in purchasing power.

It has a growing population of over 126 million people and borders the world's largest consumer market, the United States. In 2022, according to the World Bank, Mexico ranked 60th out of 190 economies in the ease of doing business.

Mexico currently has 13 free trade agreements with 50 countriesmaking it one of the most open and competitive markets in the world.

It also offers significant potential for capital investment, as it ranks 11th globally in providing credit facilities to new international companies. In addition, the country's weaker currency provides greater purchasing power for your business opportunities in Mexico.

A highly trained talent pool awaits you in Mexico. Its workforce was ranked ninth best out of over 60 countries in ManpowerGroup's Total Workforce Index. It scores the workforces of countries on over 200 unique factors grouped under the categories of availability, cost-effectiveness, regulation and productivity.

Mexico's Economy Minister Raquel Buenrosotro announced in November that “more than 400 North American companies intend to undertake a relocation process from Asia to Mexico.”

The Mexican government is focused on improving the country's infrastructure including the telecommunications, energy and transportation sectors.

Overall, the government has a positive attitude towards foreign investment, offering tax breaks, research and development incentives and tariff deferral programs. All these factors make Mexico an attractive place to do business in 2023.

The Best Industries for Mexico Business Opportunities

Mexico has become a prominent manufacturing economy, specializing in the production of several significant export products, such as electronics, petroleum, and agricultural products.

But beyond the manufacturing market, Mexico has business opportunities in these five industries.

• Fintech
• Tourism
• e-commerce
• Pharmaceutical
• Car

1 – Fintech

The Mexican financial technology market has experienced significant growth in recent years. It is expected to increase in 2023 with the increase in mobile device transactions.

With the country's increasing acceptance of technology, digital financial tools such as mobile wallets and contactless payments are likely to continue to flourish in Mexico. The 2022 Latam Tech Report predicted the use of cash will decrease by 38 percent in Mexico, by the end of 2024.

Investors can find a wide range of encouraging business opportunities in Mexico in the financial technology sector.

2 – Tourism

Tourism is an important industry in Mexico, currently accounting for eight percent of Mexico's GDP. In 2022, 58 million international visitors entered the country between January and November and average spending increased by 38 percent.

Mexico has one of the fastest growing tourism industries in the world. According to a recently published Economic Impact Report (EIR), it will generate more than 2.7 million new jobs over the next ten years.

3 – e-commerce

The Covid-19 pandemic dramatically accelerated the adoption of e-commerce in Mexico. It is expected to grow annually by over 16 percent until 2027 with over 88 million users.

New markets are emerging while established markets have the potential to increase even more. The Mexican e-commerce market offers significant business opportunities in 2023.

4 – Medicines

Mexico has the second largest pharmaceutical market after Brazil in Latin America and ranks among the top 15 globally. By 2025, it is expected to grow to over USD 30 billion.

It is home to a robust antibiotic, analgesic and antiparasitic manufacturing industry. In addition, the local market tends to prefer branded products to generics, making it an ideal location for licensing innovative drugs.

5 – Vehicles

Experts predict that Mexico could become the third largest producer of auto parts in the world. Auto manufacturing in Mexico hit a new record of $107 billion last year, reflecting a 12.6 percent increase from the previous year.

As nearshoring activities continue to grow, the future looks bright for the Mexican automotive industry in 2023 and beyond.

What is the economic outlook for business opportunities in Mexico?

The Mexican economy continues to defy the global downturn with positive numbers in 2023. The International Monetary Fund (IMF) raised its forecast for Mexico's GDP growth in 2023 in January.

Its strong automotive, agriculture and tourism sectors have helped it stay afloat along with an increase in nearshoring. Despite rising inflation, Mexico's interest rate of 7.9 percent puts it in better shape than other Latin American countries such as Colombia, Chile and Peru.

Now is a good time to invest in Mexico business opportunities before the market becomes oversaturated.

Biz Latin Hub can help your business grow

If you are thinking of doing business in Mexico, Biz Latin Hub is an ideal partner for you.

We have a team of bilingual business support specialists based in Mexico who can offer you personalized services. These services include business formationAccounting and Taxation, legal supportemployment and PEO.

Our experts are equipped to help you do business not only in Mexico but also in the rest of Latin America. To learn more about our services and how we can help you succeed, get in touch with our team of specialists today.